Priceline.com Second Quarter Earnings PREVIEW

S&P 500 (NYSE:SPY) component Priceline.com (NASDAQ:PCLN) will unveil its latest earnings on Tuesday, August 7, 2012. Priceline.com is an online travel company that offers travel services, including hotel rooms, airline tickets, vacation packages, car rentals, cruises, and destination services.

Priceline.com Earnings Preview Cheat Sheet

Wall St. Earnings Expectations: The average estimate of analysts is for profit of $7.06 per share, a rise of 34% from the company’s actual earnings for the same quarter a year ago. During the past three months, the average estimate has moved down from $7.14. Between one and three months ago, the average estimate moved down. It has been unchanged at $7.06 during the last month. Analysts are projecting profit to rise by 34% versus last year to $29.90.

Past Earnings Performance: Last quarter, the company beat estimates by 35 cents, coming in at net income of $3.98 a share versus the estimate of profit of $3.63 a share. It marked the fourth straight quarter of beating estimates.

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A Look Back: In the first quarter, profit rose 73.7% to $182 million ($3.54 a share) from $104.8 million ($2.05 a share) the year earlier, exceeding analyst expectations. Revenue rose 28.2% to $1.04 billion from $809.3 million.

Wall St. Revenue Expectations: Analysts predict a rise of 22.7% in revenue from the year-earlier quarter to $1.35 billion.

Stock Price Performance: Between May 7, 2012 and August 1, 2012, the stock price fell $94.67 (-12.8%), from $737.65 to $642.98. The stock price saw one of its best stretches over the last year between March 30, 2012 and April 9, 2012, when shares rose for six straight days, increasing 6.6% (+$47.25) over that span. It saw one of its worst periods between May 9, 2012 and May 18, 2012 when shares fell for eight straight days, dropping 12.1% (-$86.95) over that span.

Key Stats:

The company enters this earnings announcement with substantial revenue momentum. The company has averaged year-over-year revenue growth of 38.1% over the last four quarters.

After experiencing income increases the last three quarters, the company is hoping to keep the good news coming with this earnings announcement. Net income rose more than twofold in the third quarter of the last fiscal year and 66.3% in the fourth quarter of the last fiscal year before increasing again in the first quarter.

Balance Sheet Analysis: The company’s current ratio of assets to liabilities came in at 3.26 last quarter. Having a ratio above 2:1 is usually considered a good indicator of a company’s liquidity and ability to meet creditor demands. The company improved this liquidity measure from 2.77 in the fourth quarter of the last fiscal year to the last quarter driven in part by an increase in current assets. Current assets increased 37% to $4.2 billion while liabilities rose by 16.7% to $1.29 billion.

Analyst Ratings: With 15 analysts rating the stock a buy, none rating it a sell and one rating the stock a hold, there are indications of a bullish stance by analysts.

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(Company fundamentals by Xignite Financials. Earnings estimates provided by Zacks)

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